AdMob, Google, Apple

Along with everyone else, I’ve been pondering the Google acquisition of AdMob. Some thoughts:

  • Google needs to be in mobile hosted media; Apple’s early move towards owning that space had the potential to sideline Google. Apple owned the customer. Thus Android and now AdMob.
  • The mobile platform that is successful long-term will depend on the media available on it.
  • The success of mobile based media relies to a large extent on the economics of advertising both on the devices and by tying the user of the device to their web presence*.
  • The companies best positioned to improve these economics are Google and Apple. Among other reasons, because only they can tie online and mobile behavior of a large portion of mobile users through their control of the iPhone and Android app stores.

I think the upshot is that Apple needs to do something soon. As someone smarter than me said today, Apple has no advertising DNA. They either need to start hiring ad people**, and I hear nothing to that effect, or they need to buy something. Not necessarily an ad network, but something that gives them a means to extend the advertising ecosystem on the iPhone***.

But, PLEASE, don’t take this news to mean that you should run out and start a mobile ad network. After the huge valuations put on web ad networks in 2007 (Doubleclick+Google, aQuantive+Microsoft, 24/7+WPP) there was a rush of company-starting and venture-funding that has, by and large, come to naught. By the time Google buys something, it is already too late to start a me-too competitor. Waaay too late. Build for three years from now, not for yesterday.

* Both web retargeting based on mobile media usage and mobile targeting based on web usage will be extremely effective once they are available. The privacy implications of this are… interesting. But I’m not going to open myself to entirely valid accusations of hypocrisy by passing judgement. Others can do that more effectively.

** Meaning people who understand the new math and operations behind advertising. Not creative folk.

*** 16 C.F.R. 255: I have an investment in one, natch.